Call for expanding tax base to ensure economic growth

LAHORE: The policies aimed at expanding the tax base and backing legitimate businesses remain critical for sustainable economic growth.

“Farmers should not be used as a shield in debates where the facts suggest otherwise,” said Muhammad Jamil Arif, spokesperson for Umeed-e-Sehar, adding: “Tobacco cultivation supports thousands of livelihoods and those livelihoods deserve to be protected through honest and informed discussion. When claims are made without accurately reflecting who bears the tax burden, they risk creating confusion and distracting attention from the policy itself.”

Umeed-e-Sehar has welcomed the Federal Budget 2026-27, citing its focus on supporting economic activity, encouraging formal business growth and strengthening compliance across key sectors, he said, adding: “Umeed-e-Sehar also appreciated the federal government’s continued commitment to curbing illicit trade, which deprives the exchequer of significant revenues while disadvantaging law-abiding businesses and distorting fair competition.”

The organisation, however, expressed concern over claims made during National Assembly proceedings by a senator that the proposed Rs390 per kilogram advance tobacco tax would burden farmers, destroy livelihoods and facilitate monopolistic practices in the sector. It said such claims risk creating unnecessary fear among farming communities and misrepresenting the actual intent of the measure.

The organisation clarified that the proposed levy is not a direct tax on farmers and is paid by companies purchasing tobacco, not by growers. It said framing the measure as an attack on farmers diverts attention from the policy itself and undermines informed public debate.

Jamil Arif welcomed the government’s rejection of claims that did not accurately reflect the structure of the proposal and reiterated that legitimate concerns deserve serious consideration only when grounded in fact. He said Umeed-e-Sehar remains committed to supporting measures that strengthen the formal economy, improve compliance and address illicit trade. He called for public policy discussions to stay grounded in accurate information, adding that Pakistan’s broader economic interests are best served when proposals are evaluated on their merits.

Copyright Business Recorder, 2026